Thirwall's law posits that a country's economic growth rate (relative to that of the rest of the world) depends on a ratio of its export's income elastcity of demand to that of its imports. Empirical studies of this hypothesis have almost been entirely supportive, but we argue that the method...

A fundamental question that arises in derivative pricing is why investors trade at a fair price. A common opinion attributes trading to differences in the beliefs that market participants have about the future development of market prices. We develop a model that accounts for investors'...